Honolulu—HFF has arranged a $30 million refinancing loan for two full-service Honolulu hotels totaling 581 guestrooms.

HFF worked on behalf of TEG Hotels LLC with a major U.S. insurance company to secure the 30-year, fixed-rate loan that has a 30-year amortization. The borrower is using the proceeds to pay off an existing loan and fund capital improvements. The properties are on a ground lease with 30.5 years remaining.

Airport Honolulu Hotel

Both hotels are situated in Northern Honolulu, at the entrance to Honolulu International Airport, the main point of arrival for Oahu’s five million annual visitors.

Both hotels offer fitness centers, business centers and outdoor pools with sun decks. The Airport Honolulu Hotel has two four-story buildings and features a picnic area, 3,401 square feet of meeting space and the full-service Willoughby’s Restaurant. Best Western The Plaza Hotel, which comprises one 12-story tower and three two-story buildings, offers 3,024 square feet of meeting space and the full-service Plaza Café.

Best Western The Plaza Hotel

The hotels’ surrounding area will have three stops on the Honolulu Rail Transit project, which is scheduled for completion in 2017 and will consist of 21 stations that connect West Oahu to the airport and continue into downtown Honolulu. The rail project will offer guests access to major tourist destinations, including Pearl Harbor Naval Base and Lagoon Drive. Waikiki Beach is six miles from the hotels, and Diamond Head is less than 11 miles away.

Director Bill Fishel, based in HFF’s Los Angeles office, led the debt placement team representing the borrower.

“Institutional lenders and investors are squarely focused on increasing their allocations to Hawaii,” Fishel said in prepared remarks. “The lender was exceptional to work with on this transaction, and we were thrilled to secure a 30-year financing given the borrower’s long-term ownership plan and today’s historically-low interest-rate environment.”